Thank you, members of Parliament, fellow panellists, and other guests. Good afternoon. We really thank you a lot for this opportunity to talk about our CCS project here today.
For those of you who may be unfamiliar with TransAlta, we are Canada's publicly traded power generator and wholesale marketer of electricity. We have power plants in every province, from British Columbia to New Brunswick, with the exception of Manitoba. We also own and operate power plants in the United States and in Australia. In total, we have 185 plants and 10,000 megawatts of capacity, which makes us about the same size as BC Hydro.
We're celebrating our 100th year this year. We started out as a hydroelectric power producer, moved into thermal generation, and in the last 15 years have developed extensively in renewables. It may surprise you to know that TransAlta is Canada's largest wind developer and that more than 22% of our fleet is from renewable sources.
Our growth strategy is exclusively focused on clean energy, both in renewables such as wind, hydro, and geothermal, and in clean fossil technologies, such as CCS with Project Pioneer, which is what I'm really here to talk to you about today.
Project Pioneer, for those of you who don't know, is a partnership of private industry and government and will be one of the most significant initiatives on CO2 in the next decade in Canada. It's designed to preserve the economic value of our vast natural resources; it will advance Canada’s reputation as a developer of clean energy solutions and it will actually reduce CO2.
Just as an aside, we are really pleased to have the Government of Canada as a partner in this initiative. With five major CCS projects currently in development in Canada, we believe our country is leading the world in developing the G-8 target of 20 CCS projects around the world by 2015.
By 2015, Project Pioneer will be amongst the largest, fully integrated CCS systems in the world. We will build it to retrofit to our Keephills 3 coal plant, and it will use the chilled ammonia process to capture and permanently store a million tonnes of greenhouse gases per year.
The first stage of Project Pioneer will be to store the captured CO2 in several deep wells in a geological formation next to Keephills. We will inject the purified CO2 underground more than two kilometres deep through drill sites identified in conjunction with the Wabamun Area CO2 Sequestration Project, or WASP study, headed by Dr. David Keith of the University of Calgary. We expect this stage to last at least two years.
The second stage of Project Pioneer will stop geological sequestration and instead transport the captured CO2 via pipeline to mature oil fields about 70 kilometres away for enhanced oil recovery.
The benefits of the project are both environmental and economic. On the environmental front, I'd really like to stress that a million tonnes of CO2 will be annually sequestered from the coal plant, which is equivalent to removing 160,000 cars from Canada’s roads every year. In addition, the capture will reduce SO2 emissions and particulate matter by about a third of what they are today.
On the economic front, Wright Mansell Research has estimated that over the life of Pioneer, it will increase Alberta’s GDP by $2 billion to $3 billion; increase labour income by about $675 million; efficiently extract an additional 22 million barrels of oil production from existing oil fields in Alberta; increase federal, provincial, and local government revenues by between $259 million and $1.2 billion; and add 8,800 person-years worth of employment.
As I have mentioned, Pioneer’s disposal plan for the captured CO2 will be to inject a million tonnes annually underground, first into permanent geological storage and then into mature oil fields.
As the Integrated CO2 Network has concluded, EOR can be an economic catalyst to advancing CCS projects across Canada, particularly in Saskatchewan, Alberta, and British Columbia.
However, over time, the expected amount of CO2 to be captured in Canada will greatly exceed what can be developed for EOR, so eventually some of it will have to be sequestered in geological formations.
Fortunately in Canada, a number of geological formations hold promise for secure, long-term storage of CO2. Direct storage at these locations will be necessary to handle the large volumes of CO2 associated with capture over the longer term. These locations include depleted oil and gas reservoirs, deep and uneconomic coal formations, and deep saline formations. Deep saline formations can be found in various areas of western Canada several kilometres below the land surface and geologically separated from ground water sources, which I think is of interest to the committee today.
Specific injection sites for Project Pioneer will be determined in conjunction with the pre-existing WASP study. This study--of the region in the immediate vicinity of our Keephills plant--recently concluded: storage capacity for CO2 is conservatively estimated to be 250 million and 400 million tonnes; seismic analysis indicates no faulting in the study area; and an estimated 34% of the CO2 dissolves within the first year of storage, while 56% of the CO2 will be dissolved after 50 years.
The CO2 is initially trapped primarily by physical means below capped rock. Over time, there are additional chemical mechanisms to immobilize the CO2 to prevent any potential release. For example, the sequestered CO2 will mineralize with the rock, be trapped in small pores of the permeable rock, and dissolve into water trapped deep within the formation. We will use the study's findings plus additional seismic investigation to locate test wells within underground formations near Keephills. Our plans are to drill several three-kilometre-deep test wells to establish injection capability for the full rate of 3,000 tonnes per day, which turns out to be a million tonnes per year for Pioneer.
I just want to talk for a minute about the safety of underground storage. CCS includes a mixture of both proven and emerging technologies. What is exciting about Project Pioneer is that it fully integrates both those proven and emerging technologies on a large scale. It will be the first large-scale project of its type in the world when it's finished. Our project will include a full range of capture, transportation, and storage of CO2. You all know that CO2 transportation via pipelines for EOR has been under way in Canada and the United States for a decade. You probably are familiar with the Cenovus project in Weyburn, which has been often talked about in this context.
CO2 storage is used in a number of countries and has been extensively studied as to the integrity of the chosen geological formations to ensure that no leakage occurs.
In Canada, the geological formations being considered as likely candidates for long-term CO2 storage have already proven safe for storing other gases and liquids. These same formations have trapped crude oil and natural gas underground for millions of years. The formations consist of layers of permeable rock capped by a thick layer of impermeable rock. While the gases and fluids can pass through or be stored in the pores of the permeable rock, they cannot move up past the impermeable rock. It acts as a cap. As a result, any CO2 injected into the permeable formations remains trapped there.
The Petroleum Technology Research Centre recently conducted a risk assessment process in 2004 to evaluate the long-term result of CO2 injected into the Weyburn reservoir. In a case study, 4,000 parameter combinations were evaluated and the results indicated that after 5,000 years there was a 95% probability that 98.7% to 99.5% of the initial CO2 in place will remain stored in the geosphere for 5,000 years.
Across western Canada there are about 40 sites where acid gas--a combination of hydrogen sulphide and carbon dioxide--is currently being injected into deep underground formations for permanent storage, and this has been going on for decades. Right now, about two million tonnes of acid gas are injected and stored underground every year. This is a perfect analogy for CO2 geological storage.
According to the Alberta Geological Survey, incidents have been rare and minor and have not resulted in leakage of acid gas into groundwater or the atmosphere. As opposed to hydrogen sulphide, it is important to note, carbon dioxide is not toxic, is not hazardous, and is not flammable. This proves a scientific basis and a proven track record for the safe injection of CO2 underground, and this is how Project Pioneer will proceed--safely, or not at all.
I know I'm running out of time here, so I'll just take a minute here to talk about our monitoring, because I think it is quite important to understand.
As for all human activities, there are always risks involved. Project Pioneer will employ a highly competent and experienced team of subsurface geoscientists who will make use of all available data to ensure that the formations recommended for CO2 sequestration have the necessary features to ensure they will serve as safe, long-term containers for CO2 storage. There will be additional safeguards recommended for any ongoing CO2 sequestration, and these will all be managed through a properly designed monitoring, measurement, and verification program.
I've just got a couple of minutes left here. Do you want me to continue, or do you want me to wait--